The controller of Excello Manufacturing, Inc., wants to use analytical procedures toidentify the possible existence of idle equipment or the possibility that equipmenthas been disposed of without having been written off. Which of the following ratioswill best accomplish this objective?(1) Depreciation expense/book value of manufacturing equipment.(2) Accumulated depreciation/book value of manufacturing equipment.(3) Repairs and maintenance cost/direct labor costs.(4) Gross manufacturing equipment cost/units produced.
The controller of Excello Manufacturing, Inc., wants to use analytical procedures toidentify the possible existence of idle equipment or the possibility that equipmenthas been disposed of without having been written off. Which of the following ratioswill best accomplish this objective?(1) Depreciation expense/book value of manufacturing equipment.(2) Accumulated depreciation/book value of manufacturing equipment.(3) Repairs and maintenance cost/direct labor costs.(4) Gross manufacturing equipment cost/units produced.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The controller of Excello Manufacturing, Inc., wants to use analytical procedures to
identify the possible existence of idle equipment or the possibility that equipment
has been disposed of without having been written off. Which of the following ratios
will best accomplish this objective?
(1)
(2)
(3) Repairs and maintenance cost/direct labor costs.
(4) Gross
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